Category: Featured

For SpaceX, Amazon and other LEO satellite constellations, spectrum and landing rights issues remain

SpaceX’s Starlink has a license in the United States. The rest of the world will be more complicated. Credit: SpaceX
WASHINGTON — Aspiring operators of constellations providing broadband data, OneWeb and Telesat, said they admired prospective competitor Amazon as a company but that Amazon would need to play by the same spectrum-reservation rules as everyone else.
Amazon’s proposed constellation of low-orbiting satellites was one of the recurring topics at the Satellite 2019 conference here May 6-9.
Amazon has said little about its intentions and it is unclear what spectrum it plans to use and what coordination efforts it will have to complete with operators ahead of Amazon on the frequency-registration list at the International Telecommunication Union (ITU).
Unlike aspiring constellation operators OneWeb, Telesat, SpaceX and LeoSat, the funding question never comes up with Amazon. If its chief executive, Jeff Bezos, decides he’s all in on a LEO constellation play, it’s not cash that will be the roadblock.
Access to radio frequency is another matter. Here too, officials said that if Bezos threw enough cash at the frequency problem, he probably could solve it. But even the world’s richest man cannot easily reorder the priority list at the ITU, which is set by application date and milestone deadlines.
Michael Schwartz, senior vice president at Telesat, said his career history includes terrestrial wireless as well as satellite. Frequency access is of huge importance in both.
“If this were a terrestrial mobile conference, and someone said: ‘I am going to build a network, I have no spectrum rights but don’t worry about that, I’ll build the network and I’ll figure that out,’ they wouldn’t be listened to,” Schwartz said.
“I am not sure why, but people in the satellite industry don’t pay enough attention to the need for spectrum rights and how ITU priority works. It’s hard to build a network when you don’t have authorization to do so.”
Spectrum rights is also an issue that comes up frequently with SpaceX’s Starlink constellation, for which 60 satellites were successfully launched on May 23. SpaceX has changed part of its orbital architecture to lower the orbit from 1,200 kilometers to 550 kilometers.
The U.S. Federal Communications Commission (FCC) accepted that and authorized the May 23 launch, but the ITU has yet to weigh in.
“I have as much respect as anybody for Jeff Bezos and [SpaceX founder] Elon Musk, but at the end of the day, the rules that govern access to spectrum will apply to hem as it applies to other companies — and my company,” Schwartz said.
OneWeb Chief Financial Officer Thomas Whayne agreed.
“The spectrum is a real uncertainty, because there was no specificity around that,” Whayne said of the Amazon project. “I know Amazon can fund this, and fund it with their principal shareholder. So at some point, if they are serious about it, they will find the spectrum and find the money.
“The reality with Amazon is that everything they do is best-in-class, whether it’s e-commerce or web services. I do think they’ll figure it out. It will take a bit of time. One of the important advantages we have is that we will be in the market years before they will. We and our shareholders never thought we would be alone.”
After the ITU license, a struggle for landing rights, one nation at a time
In addition to navigating the ITU process and the spectrum negotiation with other LEO-orbit constellations, Amazon and he other constellations will need landing rights, nation by nation.
Whayne said OneWeb, which has launched its first six satellites to preserve its ITU reservation and plans regular launches starting late this year, is “working on it [landing rights] very actively. We have made a lot of progress and will make more in the coming months. But we fully expect we will provide global coverage.”
OneWeb, which is registered in the United Kingdom, made an early Ku-band filing with the ITU and believes all other Ku-band constellations will need to assure non-interference with the OneWeb system, just as OneWeb and the other LEOs will need to assure non-interference with Ku-band transmissions from geostationary-orbit satellites.
“We have priority spectrum in Ku,” Whayne said. “The coordination issue is not ours. We do have some coordination issues in Ka-band [for communications with OneWeb gateway Earth stations]. Ku-band is the more important because that is where the potential interference is.”
Other satellite operators, such as mobile satellite service providers Iridium and Inmarsat, have spent years getting access to nations whose markets are important to them. Broadband hardware and service provider Hughes Network Systems has spent years trying to establish a satellite consumer-broadband service in India and is still waiting.
There is every reason to expect that a two-way broadband data service will have at least as much trouble getting full access to markets such as India and China.
Schwartz said initial indications are that the Amazon project will target a mass consumer audience, unlike the Telesat LEO program, which is going after maritime, aeronautical, cellular backhaul and government markets.
That market focus means Telesat is less concerned than SpaceX or OneWeb or perhaps Amazon with a breakthrough in flat-panel antenna technology that brings down prices to within the reach of a mass consumer market.
“We look at cost as the total cost of ownership — the cost per megabit amortized,” Schwartz said. “Broadband to enterprise means [customer premises antenna retail price] doesn’t have to be in the hundreds [of dollars]. We certainly look forward to improvements, but it doesn’t have to be a super-low cost.”
One unknown hanging over all the LEO constellations is what milestone-deployment requirements will be imposed by the ITU at its World Radiocommunication Conference, WRC-19, scheduled for Oct. 28- Nov. 22 in Sharm el-Sheikh, Egypt.
WRC-19 is expected to produce its own set of milestones to encourage constellation operators not to sit on their spectrum, on penalty of losing their licenses.
It is also unclear when the WRC-19 will start the countdown clock. Early indications are that it would start sometime in October or November, during WRC-19.
“There are a half-dozen proposals on the table,” said Erwin Hudson, vice president of Telesat LEO. “All of them are structured about the same. The fraction of satellites you need to have at each milestone is the open question, and then of course: When does the clock start? I am optimistic that we can meet either set of milestones.”
Telesat LEO is registered in Canada. SpaceX’s Starlink is registered in Norway and the United States. LeoSat is registered in France.

Viasat hitting on all three cylinders with revenue, EBITDA growth; dual Ku-/Ka-band aero antenna a fresh focus

Credit: Viasat
PARIS — Satellite broadband hardware and services provider Viasat Inc. said in-flight connectivity service revenue totaled $150 million for the year ending March 31 on the strength of new in-flight connectivity (IFC)-equipped planes entering service.
The Viasat fleet totaled 1,312 aircraft as of March 31 — up 60% from a year ago — with another 490 in backlog awaiting installation.
The IFC service is lifting Viasat’s Commercial Networks division, which builds the hardware. That division reported a 21% increase in revenue for the year and a reduced operating loss of $108.6 million.
Takeaways from Viasat’s Q4 conference call:
— Double-digit revenue growth for year ending March 31 in all three divisions — Satellite Services, Commercial Networks, Government Systems; total revenue up 30% to nearly $2.1 billion.
— The ViaSat-1 satellite, in service since 2013, has “enabled” $1 billion in adjusted EBITDA on a capex investment of $500 million and has more than 10 years of service left.
— Viasat-s dual Ka-/Ku-band antenna, in service for government customers, is now being deployed for wide-body long-haul commercial aircraft to provide backup in case of satellite launch issues and to broaden coverage area.
— Boeing 737 Max accounts for around 4% of Viasat’s installed base and will be a drag on service revenue, but not a large one.
— In-flight connectivity (IFC) growth is driving growth in Commercial Networks for equipment sold to airline customers. As of March 31, 1,312 aircraft were in service, plus 490 in backlog awaiting installation.
— Churn down, ARPU up in Satellite Services division, where IFC service revenue is now 22% of total division revenue.
— The Government Systems division continues to lead the way. Full-year revenue up 24% to $956M; EBITDA margin stable at 26%. Co. continues ‘filling in the white spaces between what military operational units need and what government procurement regulations deliver,’ said CEO Mark D. Dankberg.
—Capex was $675M for full year and will rise to around $975M in coming year with spending on three-satellite ViaSat-3 constellation, to launch starting 2021.
IFC provider Gogo Inc. said the failure earlier this year of the Intelsat IS-29e satellite demonstrated the inherent advantages of Ku-band satellite technology, with its large fleet of satellites from multiple fleet operators, compared to Ka-band.
Gogo said Intelsat 29e customers were quickly relocated to other Ku-band satellites, minimizing their service outages, in contrast to what would have happened if a Ka-band satellite went down:
That’s one reason why several antenna manufacturers are working on dual Ka-/Ku-band hardware.
Credit: Viasat
Viasat Chief Executive Mark D. Dankberg said the Viasat dual-band equipment has already proved itself with U.S. government customers and that the company in the coming year will be investing in placing the dual-band system with long-haul commercial airline fleets.
Viasat has said its ViaSat-3 satellite fleet, rising the global from geostationary orbit, will be complemented by capacity offered by third-party satellites, such as what it has done in Brazil and Australia and plans to do in China:
The strategy adds to the capacity available to Viasat and helps position the company as a friendly neighbor in Asia and Latin America instead of a threat.
Credit: Viasat
Introducing the dual-band antenna adds another layer of protection to prospective airline customers in the even the ViaSat-3 program is delayed.
Dankberg said the ViaSat-3 program will be in service at a time when many airlines are planning retrofits of their IFC hardware or planning deliveries of new planes.
The dual-band strategy allows Viasat to bring into service aircraft customers even if ViaSat-3 is late.
“It’s kind of an insurance policy against the timing of satellite launch,” Dankberg said. “One of the things the international carriers are looking at is, not just do we have 100% of their routes covered, but what fraction of their seat miles do we have covered? Once we get to the 70-80% ranges, it’s really interesting.
“If you can use Ku-band to fill in the gaps at a modest up-front cost, that’s a pretty attractive offer as well.”
Dankberg said the Ka-band unit suffers no performance penalty by adding the Ku-band capability to it.
Viasat President Richard Baldridge said most Viasat long-haul customers “spend a lot of time in our high-capacity Ka-band coverage, so we’re really just talking about the fraction of the time outside that coverage.”
Viasat said the average monthly subscriber revenue for the year was up 12%, to $81.99, a figure that includes IFC revenue. The company’s fixed broadband subscriber count was not provided, but Viasat said it increased slightly.
UPDATE May 29: In a filing with the U.S. Securities and Exchange Commission (SEC), Viasat reported 586,000 subscribers as of March 31, compared to 576,000 a year ago.
Dankberg reiterated Viasat’s policy of favoring fewer consumer subscribers paying for premium services over generating growth in the number of subscribers.

Swedish terminal builder Ovzon, its first satellite to launch in 2021, concludes deals with GetSAT, Intelsat, Hispasat

Ovzon Chief Executive Magnus Rene. Credit: Ovzon
LUXEMBOURG — Swedish satellite broadband terminal builder Ovzon reported a 15% increase in revenue in the first quarter of 2019 compared to the previous year and posted a 9% operating-profit margin after a loss the year before.
Ovzon also said that after testing Israel-based GetSAT’s mobile communications terminals for land and maritime applications, it will embed GetSAT’s flat-panel technology into Ovzon’s future satcom-on-the-move service.
GetSAT has patented what it calls its InterFLAT technology to handle signal transmission and reception on the same panel to reduce the size, weight and power requirements of the company’s MicroSAT land/mobile terminals:
Ovzon, with a terminal background, will be providing an end-to-end satellite service on leased satellites, including the Intelsat IS-39 to launch later this year, and Ovzon’s first satellite, Ovzon-3, to launch in 2021:
Ovzon’s service and products target government agencies and NGOs, among other verticals.
“We look forward to supporting a very demanding customer base together with Ovzon,” GetSAT Chief Executive Kfir Benjamin said in a May 23 statement.
GetSAT’s MicroSAT Land Mobile terminal. Credit: GetSAT
The GetSAT agreement comes just weeks after Ovzon entered a strategic partnership with Hispasat of Spain to offer mainly government customers a monthly service that combines Ovzon’s T5 portable terminal and Hispasat Ku-band capacity in Europe and Latin America. The service is designed to offer 60 Mbps connectivity.
“Ovzon has developed a great technology which allows high-performance satellite communications on a light and small portable terminal, making it perfect for a wide range of critical applications, including those which require high speed and broadband access,” Hispasat Chief Commercial Officer Ignacio Sanchis said of the agreement.
Reporting its Q1 2019 financials, Ovzon said it had secured a contract, valued at $56 million, from Intelsat to purchase Ovzon 3 capacity for three years. Ovzon has purchased two steerable beams on IS-39. Intelsat will be selling the IS-39 capacity to broaden Ovzon’s geographic coverage in Africa, the Middle East and Asia.
In a statement, outgoing Ovzon Chief Executive Per Wahlberg said the Intelsat deals mean Ovzon has a backlog of satellite bandwidth orders totaling 600 million Swedish krona, or $64.4 million.
Ovzon-3 is a relatively small SSL-500-series geostationary-orbit telecommunications satellite under construction at Maxar Technologies’ SSL division and scheduled for launch, in 2021, aboard a SpaceX Falcon Heavy rocket.
Ovzon’s new chief executive is Magnus Rene, a former CEO of Arcam AB  and of 2001-2018 and of Hogia Teknkik.
Ovzon has estimated that the entire Ovzon-3 program — satellite, launch, insurance and financing — will cost 1.5 billion krona, of which it has raised 750 million krona in a share issue earlier this year. The remaining financing will be secured this year, Wahlberg said.
For the first three months of 2019, Ovzon reported revenue of 53.4 million krona, up 15.2% over the same period a year ago. Operating profit, at 4.6 million krona, was 9% of revenue after an operating loss a year ago. Operating cash flow for the quarter ws 24.7 million krona, versus a negative 28.1 million krona a year earlier. 
The company said the loss a year ago was the cost of a listing on the Nasdaq First North Premier market and a 6.5-million-krona charge to station a orbital satellite at an Ovzon-registered orbital slot to avoid the loss of the reservation under International Telecommunication Union (ITU) rules.
The IS-39 and Ovzon-3 satellites will add 40% to Ovzon’s current capacity and pave the way for what the company says should be near-term growth. Until then, revenue should be flat, Wahlberg said.

China’s commercial satellite and launcher space boom: ‘Thank you Elon Musk and Jeff Bezos’

Chinese commercial space companies, by sector. Credit: Shufan Wu
LUXEMBOURG — More than 50 privately financed Chinese commercial space companies have been created in the last three years, taking advantage of a government policy that encourages private-sector involvement in a former state monopoly.
China’s NewSpace movement shows every sign of accelerating, even if there is the risk of a bubble similar to that seen in some niches of the U.S. and European NewSpace sectors.
China’s commercial space scene. Credit: Shufan Wu
“Chinese economic growth has been so fast and in the past two years space has gotten into what we call the ‘wind window,’” said Shufen Wu, a professor of aeronautics and astronautics at Shanghai Jiao Tong University and founder of satellite-manufacturing startup MinoSpace.
“And if you are in the wind window, even a pig can fly,” Wu said here May 21 at the Luxembourg Space Forum. “A lot of private and state-owned investors are coming into the sector. And with cheaper launches and cheaper spacecraft, people are thinking about new activities.”
Smallsat players in China. The list is not comprehensive. Credit: Shufan Wu
Wu said most of these companies are focusing on the domestic Chinese market and not yet looking for exports.
The nature and extent of China’s private-sector space movement is still unknown to many in the West, and occasionally the subject of suspicion.
At the recent Satellite 2019 conference in Washington, the CEO of a large U.S. space-hardware company said behind every so-called private Chinese launch-service startup is the People’s Liberation Army.
Wu and Ji Wu, of the Chinese Academy of Sciences’ National Space Science Center, denied that, as did Yang Feng, founder and CEO of Spacety, a commercial satellite builder.
Spacety founder and CEO Yang Feng. Credit: Space Intel Report
“We don’t get money from government support,” Feng said at the meeting here. “We get money from commercial venture capitalists. Spacety was the first to get venture capital in the satellite business, in 2016, when it was really hard to raise money.”
Feng and both Ji Wu and Shufan Wu described a Chinese space-startup scene not much different from what’s happening in the rest of the world, where wealthy private individuals, venture-capital companies and other sources of financing see space as a high-growth sector.
China’s share of the global smallsat production market. Credit:
It started in 2014, when the Chinese Cabinet issued a decree allowing private companies to build and launch satellites.
“We say that 2015 is T-Zero for Chinese commercial space, since that’s when companies began to be formed,” said Shulan Wu.
“Some of us who had been working in the space sector just quit our jobs,” Feng said. “We wanted to be the Chinese SpaceX, the Chinese Elon Musk. At the time it was based on dreams. We  tried to find venture capitalists to invest in us. At first, nobody was interested. In some places in China, launching satellites is considered [a bad investment]. But right now it’s easy, and I want to thank Elon Musk and Jeff Bezos, because Amazon now has a satellite business.”
Amazon has taken initial steps toward a global low-orbiting broadband satellite constellation, but many questions remain about where the effort is going.
Chinese regulations opened up the space sector to private investment in 2014, making 2015 “T-Zero.” Credit: Shufan Wu
Feng said Chinese investors see the enthusiasm in the West for private space investment and have provided cash to multiple startups.
“Right now there are so mani rocket and satellite companies that are getting invested. This is really good for Europe, because we cannot buy anything from the States,” Feng said. “We buy a lot from Europe. I think GomSpace must be happy, right?”
GomSpace of Denmark and Sweden is a merchant builder of small satellites. Multiple European space-component startups are wooing China, despite their wariness about protecting intellectual property, because the market is too big to ignore.
U.S. technology-transfer and export regulations make doing business in China difficult, and will also be an obstacle when China’s private sector seeks growth beyond China.
Although it’s less than four years old, Spacety has launched 12 satellites, Feng said. It plans 20 more in 2019 and 100 for 2020. “Being fast is important, and we are trying to find ways to cut the cost,” he said.

Shufan Wu identified three categories of companies at work in China’s space industry: big government-owned entities, university-related cubesat developers; and the commercial sector, which accounts for more than half of the space companies founded in the past three years.
“More and more commercial micro and nano satellite companies are coming,” Shufan Wu said, predicting that China’s currently modest rank among cubesat builders will grow quickly.
“We are only a few years into the regulatory change and the NewSpace wave has started and is booming.” He said there are at least seven small, privately financed launch-service startups. “They have not yet reached, success, but they are very close to it.”

Viasat to design LEO prototype satellite for U.S. Air Force to explore geographic extension of Link 16 tactical system

Viasat Government Systems President Ken Peterman. Credit: Viasat
LUXEMBOURG — Viasat Inc., a well-known bear on low-Earth-orbit constellations for broadband applications, will build a cubesat for the U.S. Air Force to test encrypted narrowband tactical communications to extend coverage of the Link 16 communications system used by the U.S. and allied forces.
Viasat will build the 12u cubesat in time for a launch in mid-2020 under a $10-million contract with the Air Force Research Laboratory Space Vehicles XVI program.
Viasat already provides Link 16 terminals that provide U.S. and allied forces ground, air and naval forces to maintain contact with each other. The latest contract is a test of the value of adding a space LEO-orbit constellation to the network.
The company declined to disclose the satellite’s total launch mass, its precise intended orbit or service life or what a fully operational constellation of Link 16-dedicated LEO satellites would look like.
Viasat also did not way whether this was the first satellite for which it is the full prime contractor. But Ken Peterman, the president of Viasat Government Systems, did agree to answer some questions about the Link 16 contract.
What is the primary purpose of this single satellite?
This is the first-ever Link 16-capable LEO satellite. The primary goal is to prove the feasibility of Link 16 on a LEO satellite system—which has significant value and potential because Link 16 is a widely used system, with more than 100,000 terminals fielded by the U.S. military and allies. Additionally, with this system, we can extend existing Line of Sight (LOS) connectivity to Beyond Line of Sight (BLOS), and in so doing, address an urgent capability gap recognized by DOD as a national priority.  
What does the contract cover? 
It’s a $10 million pilot program awarded to Viasat by the Air Force Research Laboratory Space Vehicles directorate. The contract includes options for more additional capabilities, including cross links between satellites in a future constellation. While the first development satellite costs $10 million, Viasat expects production quantities of the spacecraft would cost less.
Just one satellite so far?
Viasat is building one satellite for the pilot program. However, the XVI demonstrates a prototype capability that can flexibly scale to a larger constellation of satellites to establish persistent global coverage (including poles) with cross-links between satellites and insertion into Viasat’s global GEO communications network– essentially creating a new, global communications infrastructure using existing, fielded terminals, all integrated into the Viasat Hybrid Adaptive Network (HAN) architecture.
Is Viasat designing the platform or just the payload?
Viasat is developing the military Link 16 communications platform and LEO satellite payload.
So the prototype will not have inter-satellite links, but an operational constellation would?
The first satellite has a contract option for ISL. An operational constellation would employ ISLs, both for Leo-to-LEO communication and LEO-to-GEO communication. This would provide excellent flexibility, scalability and resilience compared to other LEO-only networks.

U.S. C-Band Alliance proposes to auction 9 20-MHz blocs; 3 can be cleared within 18 months

The C-Band Alliance proposes to divide the 200 MHz it is offering to sell to terrestrial 5G operators into nine 20-MHz blocs, called Partial Economic Areas (PEAs), plus a 20-MHz guard band. Credit: C-Band Alliance
LUXEMBOURG — The C-Band Alliance of satellite operators proposing to auction off 180 MHz of C-band spectrum to 5G terrestrial network operators in the United States proposed to auction the frequency in nine 20-MHz blocs that it said would optimize the participation of rural and urban bidders.
Three of the nine blocs could be released for 5G deployment within 18 months of an order by the U.S. Federal Communications Commission (FCC), the CBA said.
In a May 21 submission to the FCC, the CBA said the number of C-band dish antennas in these three Partial Economic Areas (PEAs) is low enough to permit them to be refitted with filters to allow terrestrial 5G within 18 months without disturbing the C-band satellite distribution that would continue in the remaining 300 MHz — and without launching new C-band satellites.
The CBA, led by satellite fleet operators Intelsat and SES and including Telesat and Eutelsat, has committed to financing the antenna retrofits and other costs incurred by their current customers to avoid signal interference as 5G terrestrial broadcasts enter what is now their exclusive C-band territory.
The CBA has said it could make the entire 200 MHz — 180 MHz after accounting for a 20 MHz guard band separating satellite and terrestrial users — available within 36 months of an FCC decision approving the auction.
For certain areas, the spectrum clearing will take more time and require the launch of new satellites. Intelsat and SES have committed to ordering eight small C-band telecommunications spacecraft if the FCC OKs the auction. Six of these would be launched:
“All incumbent C-band satellite users will be served by a denser satellite network delivery capacity similar to the planned pre-relocation C-band satellite fleets, but in the remaining 300 MHz,” the CBA said in its May 21 filing to the FCC.
The nine-bloc scenario is still subject to modification pending ongoing discussions with the interested parties, CBA said. The goal, the alliance said is to optimize the participating of bidders in both rural and urban areas.
Each block is small enough to allow regional players a shot at winning a bid, and large enough to appeal to bidders seeking to aggregate spectrum for seamless coverage in larger areas.
The CBA said the 20-MHz bloc size is compatible with 3GPP, an organization that develops mobile communications standards.

Panasonic challenges flat-panel antenna builders Ball Aerospace, Kymeta, Phasor on cost & interoperability

Lisa Kuo, Panasonic Avionics Corp. director of technical sales. Credit: Panasonic
WASHINGTON — Electronically steered antenna designers Ball Aerospace, Kymeta and Phasor and aero-connectivity provider Panasonic Avionics said affordable mass-market products were still some ways off for user terminals and that reliability is already an issue for mechanically steered antennas.
Lisa Kuo, director of technical sales at Panasonic, said airlines want antennas and modems that are future-proof, meaning at least 10 years of service before they are obsolete. That means hedging between Ku- and Ka-band equipment.
In a statement repeated multiple times here during the Satellite 2019 conference, Kuo said hardware builders need to move to interoperability even if that means sacrificing some early market advantage.
“I get it: You want to dominate the market with a proprietary system,” Kuo said. “But that is not in the interest of the customers. How can we make sure these systems can all work together?”
One path to standardization would be to design a dual Ka-/Ku-band system to permit users to remain connected as they move in and out of a given satellite’s coverage, or to switch immediately in the event of a satellite failure.
The phased array antenna builders said they are working on both.
“When we started, around 2012, Ka-band was very recent in orbit,” said David Garrood, senior vice president of business development at Phasor. “That’s why we went to Ku.
“But Ka is increasingly seen as important, and as offering lower-cost satellite capacity. So it is definitely a market we are looking at and we propose start that development in the next few months.”
Peter Moosbrugger. Credit: Ball Aerospace
Ball Aerospace has been building electronically steered antennas for military applications for years and is now positioning itself for commercial applications including low-Earth-orbit satellite constellations and 5G terrestrial networks.
Ball recently tested such an antenna to communicate with satellite fleet operator Telesat’s experimental LEO Phase 1 satellite. Ball said in January that its antenna tracked the satellite over several passes.
Peter Moosbrugger, Ball’s chief technologist for phased array and RF technology, said has already demonstrated ground user hardware for Ku- and Ka-band systems. He said the goal is to leverage the large volumes needed for 5G network antennas to bring down the unit cost of satellite user terminals.
“We are building a supply-chain ecosystem that can address a pretty wide range of supply,” Moosbrugger said. “That includes 5G and different satcom market verticals. We focus our [second-generation] architecture on something that could scale from an ecosystem that needs to be ITAR-compliant — export-control compliant — to address a worldwide market at really high volumes.”
Kymeta Corp. made a splash in the electronically steered antenna market in 2017 by saying it had deployed hardware to customers, military and commercial. Kymeta has been working with satellite fleet operator Intelsat on antennas to operate with OneWeb’s constellation of low-orbiting satellites, in Ku-band.
Lilac Muller. Credit: Kymeta Corp.
“Kymeta started with Ka-band development and pivoted to Ku for our business partnership with Intelsat,” said Lilac Muller, Kymeta’s vice president of product management.
“But when you look at what [satellite] capacity is going up in the next few years, it’s a lot of Ka capacity. We’re pursuing a Ka product in parallel to Ku. Interoperability is a big question. We’re going to tackle interoperability between GEO and LEO first, before we go to interoperability between Ku and Ka. So for us right now it’s two product lines.”
Panasonic and mobile satellite services provider Inmarsat in September 2018 announced a strategic collaboration that would enable each of them to offer the other’s in-flight connectivity solutions. Panasonic’s IFC package is in Ku-band, Inmarsat’s Global Xpress fleet is in Ka-band.
There was much industry speculation at the time over whether this was Panasonic’s way of conceding that Ka-band was the future, or was Inmarsat’s concession that it needed Panasonic’s customer base to succeed.
Kuo said it was Panasonic’s way of hedging its bets.
“We are not looking at this as Ku vs Ka,” Kuo said. “There are a lot of technologies out there and we need to diversify our portfolio. We picked Inmarsat as our first step because they are very established in the industry. This is a strategic first step that we chose. It’s really not about the frequency band.”
Unit cost vs life-cycle cost of ownership
Moosbrugger said the cost discussion between electronically and mechanically steered antennas often forgets the total cost of ownership of mechanical systems.
“I’ve seen numbers o mechanical systems that are in the 80,000- to 100,000-hour range” of commercial lifespan, Moosbrugger said. “You go on line and find the calculator for reliability and how many planes are going down [for servicing] a year, and with 10,000 planes, it’s a pretty significant number.”
Muller said Kymeta has seen similar problems with the land-transportation market where Kymeta is focused. Kymeta is not targeting the aero market yet.
“Just for reference: There are about 100,000 new or refurbished inner-city buses purchased each year,” Muller said. “That gives you a sense of the volume. You want to talk higher? RVs [recreational vehicles] — 1 million a year. Two million trucks going city to city in a year.”
While these current rooftop systems are less expensive than the electronically steered antennas, they hold out the promise of longer service life.
“The number one complaint [of railroad customers] is the amount of time they have to pull it out of service,” Mullen said. “They have guys on top of the locomotives messing around with various mechanical systems that are wearing down.
“They can’t wait for all our technologies to be out in the market to stop messing with mechanically steered systems.”

European trade union says threats to space sector are a jobs issue, defends geographic return

ArianeGroup has committed to reducing the cost of Ariane 6 by 40% compared to Ariane 5. That means fewer people, and more robots. Credit: ArianeGroup
PARIS — A European trade union urged European governments not to tamper with the geographic-return rules long in use at the 22-nation European Space Agency (ESA) and called for the creation of a space technology R&D program similar to the Clean Sky and SESAR efforts in aeronautics.
In a reflection of the growing belief in Europe that the space sector has become an engine for economic growth that now may be under threat, the IndustriAll European Trade Union’s space-policy document asks governments to limit the use of non-European technology in Europe unless the source nation’s market is equally open.
The position paper, “EU Space Strategy: Safeguard Competitiveness, Safeguard Jobs,” has proposals that will alternately upset the European Union’s executive commission, ESA, individual EU governments the managers of Europe’s space industry.
Geographical return, a perennial subject of debate in Europe, is a founding pillar of ESA and the glue that binds together nations whose wherewithal is as different as Germany’s is to Ireland’s.
It requires ESA to return to a national government more than 90% of the government’s investment in ESA in the form of contracts to national industry.
European industry officials have estimated that geographic return adds around 20% to the cost of a given ESA program, both in increased overhead costs and in propping up companies that would not otherwise survive.
The European Commission does not use geographical return.
For IndustriAll, the policy has demonstrated its value. the organization calls on EU policy makers “to consider the notion of geographical return as a factor of European cohesion, not as a restraint on profitability.”
European industry, and some European government officials, would argue that it’s both.
ArianeGroup, which is prime contractor for the heavy-lift Ariane 5 and future Ariane 6 rockets, comes in for special treatment by IndustriAl.
The company has announced that it must reduce its staff by around 2,300 equivalent-full-time positions by 2023-2024, when Ariane 5 is retired and the less-costly Ariane 6 takes over.
IndustriAll calls for “a commitment from employers that the consolidation of projects will not lead to job losses. This includes ending the current restructuring within the ArianeGroup and the potential 2,300 job losses — a quarter of its European work force — which is the greatest urgency to the European space sector.”
ArianeGroup has said it expects the vast majority of the work force reduction to occur by the retirement of Ariane 5-dedicated employees and the transfer of others to ArianeGroup’s strategic-missile and other military work.
The ArianeGroup restructuring will affect 5% of Europe’s total direct space sector employment of 45,000 jobs. IndustriAll wants individual employees to respect European labor regulations in their individual nations, and notes that ArianeGroup, a mainly Franco-German company, has not yet created a European Works Council.
ArianeGroup, in response to the IndustriAll paper, said the works council is being formed and that its creation had to await the nomination by French and German labor unions of candidates for the new organization.
The European Union is debating a proposed budget of 16 billion euros ($18 billion) to be spent between 2021 and 2027 on specific space programs, mainly the Galileo positioning, navigation and timing network, and the Copernicus environment-monitoring program.
There are separate budgets, including a European Defence Fund, and an R&D program called Horizon Europe, that are seen as possible sources of space technology funding even if they have no dedicated budget lines.
Europe’s space industry association, ASD Eurospace, has pushed for a dedicated program, but without success:
IndustriAll now returns to the subject, calling for “a joint technology initiative (JTI) and effective working structures, similar to Clean Sky or SESAR [Single European Sky ATM Research] in aeronautics, to be created for the space sector, to boost innovation by allowing industry to take more risks in R&D.”
The position paper does not directly address the continued friction between ESA and the European Commission over who will have what power over Europe’s space policy. Nor does it refer to the synergies that would result from consolidating many individual European government space agencies into ESA or  and EU format.
But it does call for “EU policy makers to have the right to scrutinize the industrial strategy for the sector, which is strategic for Europe,” which sounds like a call for more EU oversight of ESA and individual national space agencies.

Eutelsat: Yes, we missed our revenue target again. Judge us instead on EBITDA margin, cash flow, ROIC

Credit: Eutelsat
PARIS — Satellite fleet operator Eutelsat said its core broadcast market remains solid and that its poor track record in forecasting annual revenue is less important than hitting its key performance targets on EBITDA margin, free cash flow and return on invested capital.
Paris-based Eutelsat surprised the market on the downside yet again by saying its total revenue for the fiscal year ending June 30 will not be flat from the previous year, but down 3%.
But the company reiterated its EBITDA margin target of at least 78% of revenue, and a 5% average annual growth in free cash flow between 2017 and 2020.
“Even though we have missed on the revenue [forecasts] in the past, we have met all the non-revenue KPIs,” Chief Executive Rodolphe Belmer said. “Cash flow and EBITDA  have not been missed. We are delivering a financial performance that is leading the pack. Our EBITDA margin stands significantly higher, with a better orientation, than our competitors.”
That is mainly true relative to its biggest competitors, SES and Intelsat. But it’s not true for Telesat, whose EBITDA margins are better than 80%.
Eutelsat did deliver one positive surprise: an expected favorable French government tax ruling that would add 70 million euros ($78.6 million) to Eutelsat’s cash flow. A final confirmation of that assessment is expected within weeks, before Eutelsat closes its fiscal-year 2018-19 books.
In May 14 conference calls, Belmer said dismissed suggestions that Eutelsat join SES, Intelsat and Telesat in investing in non-geostationary orbit satellite broadband constellations.
While some mobile broadband applications might be well served by lower-orbit constellations, Eutelsat’s focus on fixed broadband and video distribution are immune from these new satellite architectures.
“The video segment will be untouched by LEO,” Belmer said. For fixed broadband, which is a focus of the mega-constellations, Belmer said low- and medium-Earth orbit systems will be unable, for now, to provide low-cost antennas acceptable to consumers.
Belmer also said Eutelsat is in fact making a small step into the non-GEO market with a test satellite to launch this year for a planned IoT constellation with Sigfox. Eutelsat is evaluating bids for a group of several satellites to launch as soon as 2020-2021, to be followed by a constellation of 20-30 satellites.
Belmer said these satellites will be built and launched at a price of less than 1 million euros apiece.
Credit: Eutelsat
Eutelsat’s Video division accounts for 67% of total revenue and was down 2.5% in the three months ending March 31 compared to the same period a year earlier. But the company reported stable revenue from its core broadcast business. The division total was dragged down by the continued fall in professional video, which continues to show double-digit percentage revenue reduction. It is now 8% of the division total.
Total video channels on Eutelsat’s broadcast fleet increased 2%, to 7,021 as of March 31, including 1,509 high-definition channels, up 16% from a year earlier. HD channels are now 22% of Eutelsat’s total broadcast portfolio.
Eutelsat said the total consumption of its broadcast business, measured in megabits per second, was up 2% over a year ago.
The uptake of MPEG-4 compression remains well ahead of HD channel count, meaning Eutelsat should not see a large drop in megabits used as HD expands.
Credit: Eutelsat
Eutelsat’s Konnect Africa consumer-broadband business has yet to gain traction following a remarkable string of bad luck.
Eutelsat had leased capacity on Israel-based Spacecom’s Amos-6 satellite, which was destroyed in a September 2016 on-pad explosion of a SpaceX Falcon 9 rocket. The company then leased capacity on United Arab Emirates-based Yahsat’s Al Yah 3.
Al Yah 3 was late in launching and when a European Ariane 5 rocket conducted the launch, it placed the satellite into a wrong orbit. It wasn’t until May 2018 that Yahsat declared Al Yah 3 ready for service.
But in recent months, elections in several large African markets have effectively shut down internet access. In other markets, regulations on importing satellite two-way terminals have been unclear or non-existent, blocking distribution.
Those are temporary glitches, Belmer said, and served to validate the strategy of starting small in Africa with leased capacity before the launch — now set for December — of Eutelsat’s own Konnect satellite, with a throughput of 70 Gbps.
But during the interim, Yahsat has created a joint venture with satellite broadband specialist Hughes Network Systems for Africa, the Middle East and West Asia, using the same Al Yah 3 satellite whose capacity is leased by Eutelsat:
Hughes and Yahsat have expanded their relationship to Brazil with a second joint venture.
Hughes and Yahsat have said their African venture is doing well but they have not gone into any detail. Even so, the combination of these two companies was not foreseen when Eutelsat ordered its Konnect satellite in early 2018.
“We are in competition with Yahsat for the distribution of connectivity services in Africa,” Belmer said. “We both have capacity on Al Yah 3. “Hughes has associated itself to the distribution of this service, so we are de facto in competition with Hughes.”
Belmer said that once Konnect is in service by mid-2020, it will enable Eutelsat to cut prices and stimulate growth. “Al Yah 3 only covers a portion of Africa,” he said.
The Konnect satellite will also target Europe, where Eutelsat’s Ka-Sat satellite is running out of capacity on beams covering some of the highest-demand markets.
Eutelsat is scrapping part of its wholesale distribution strategy for Ka-Sat after concluding that its distributors did not always have the incentive to maximize sales. A Preferred Partner Program with distributors that are focused on satellite internet has been put into place with promising early results, the company said.

3 years later, Global Eagle reconsiders its $550-million purchase of maritime connectivity/content provider

Global Eagle Entertainment is considering the sale of its non-aviation business. Credit: GEE
PARIS — Commercial airline in-flight connectivity and content provider Global Eagle Entertainment has hired Barclays Capital to assess the possible sale of GEE’s non-aviation business, including the maritime division for which it paid $550 million just three years ago.
Los Angeles-based GEE said it expects to conclude its evaluation of what it says have been several offers by this summer but is under no financial or other pressure to conclude a transaction.
The company said the grounding of the Boeing 737 MAX planes affects 26 aircraft using GEE connectivity, with another 40-50 737 MAX aircraft scheduled to be line-fit this year.
GEE Chief Executive Joshua Marks said the 737 MAX issue is likely to reduce GEE service revenue by $3 million to $4 million in 2019, and to cut profit by $1.5 million to $2 million, assuming the aircraft reenters service in August.
GEE reported $166.6 million in revenue for the three months ending March 31, up 6.6% from a year ago. EBITDA was $18.5 million, up 7%.
Twenty-five percent of top-line revenue, and 48% of connectivity revenue, came from the maritime, enterprise and government business that GEE is now putting up for sale.
The company said it had $51 million in cash as of March 31 and more than that as of its May 14 investor call, more than enough to manage the business this year.
GEE purchased maritime content and connectivity provider EMC in July 2016 for $550 million in cash and stock on the assumption that satellites beaming bandwidth and content to airlines could add maritime service. The merged company would generate $15 million in cost synergies in 2017 and $40 million per year from 2018.
GEE and the entire in-flight connectivity market has since been through financial stresses from which it is now recovering. It has reduced staff and other operating expenses and closed facilities.
But while the logic of buying satellite capacity and using it for both aeronautical and maritime connectivity remains valid from a pure bandwidth-purchase perspective, other areas of the business are different enough to make a sale at least potentially attractive.
At the time of the EMC purchase, several industry veterans, including P.J. Beylier of Speedcast, had warned that the aero and maritime markets were very different animals and that the synergies are not obvious:
GEE Chief Executive Joshua Marks now seems to agree, especially as the aero business moves toward high-throughput (HTS) satellites and the maritime business
“[T]he cruise business continues to be competitive,” Marks said. “[C]ruise lines procure a lot of bandwidth. That said, the importance of integrating multiple satellite networks, of having redundancy, has become critically important with the recent failure of different satellites. There are areas where we have taken advantage of joint procurement in the past. For example bandwidth… has been an area where there has been good opportunities between aviation and the maritime enterprise and government unit.
“We have kept the legal and operational structure of the [maritime, enterprise and government] entity separate. Part of that is driven by the fact that aviation connectivity continues to be a very unique business, one that requires a very significant amount of engineering know-how and an area where we have differentiated ourselves in program execution. It’s very, very challenging to drive aviation connectivity from concept through to certification and then successful live passenger service.
“So we have a maritime enterprise and government unit that has contributed a lot of great technology and a lot of great capabilities…. It is on a very strong trajectory right now in terms of cash flow improvement. So we’re actively considering what we’re doing but we’re under no pressure to do so. We’re being purely opportunistic about how we’re approaching it.”
Aviation uses modems that are not the same as the maritime, enterprise and government division and separating them will not be difficult, Marks said.
GEE said its aviation connectivity revenue grew by 12%, to $45.3 million, in the three months ending March 31. That business has grown by 30% since the trough in mid-2018.
Credit: Air France
Southwest Airlines and Air France activated a combined 22 aircraft with GEE connectivity gear in Q1, with 15 more awaiting activation. The company forecasts that it will have added more than 100 new aircraft by the end of the year, in addition to the Q1 additions.
GEE advertises its Airconnect Ku-band service as capable of delivering 500 Mbps to a given plane.
Marks said moving to HTS satellites allows the company to fine-tune its bandwidth purchases, avoiding large capacity buys in advance of customer use. “In essence, we can now be more surgical in our bandwidth acquisitions,” he said, adding that bandwidth-lease contracts in general are renewed at lower rates.
GEE said it had recently won an unnamed, large new customer in Europe for connectivity services both Boeing and Airbus single-aisle aircraft. This customer, which is already using GEE-provided content, is set to become the company’s second-largest customer after Southwest. Installations will become in 9-12 months.
GEE President Per Noren said the new customer will likely exceed the Air France order for 113 planes.

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